A "prison pussy" is a configuration of facial hair which surrounds a man's mouth (also known as a "goatee"). This ironic term is intended to insult a man who thinks his well-trimmed facial hair makes him look tough. The overt implication of the term is that men in prison would use his mouth like a vagina. This insult is especially powerful when it is spoken by a woman.

Do you know that guy John? He's a white guy, about 6 feet tall, with a prison pussy.

Bubba: boy howdy you are lookin fine joey!
Joey the Rapist: thanks my nigg you know i enjoy keeping in shape.
Bubba: nice ass, back where i come from we call that thurr prison pussy!
Joey the Rapist: thanks i guess...
(anal rape almost always follows a conversation with the word "prison pussy")

The Urban Dictionary T-Shirt

Applicable to males only. When you go to jail for whatever reason, approximately 8 people gang up on you to de-virginize you. They get a knife and slice the skin between your nuts and your asshole, and start having sex there. The prison gynecologist must sow you up, which is just more welcoming for your new friends.

Frank was sent to the penetentiary and got prison pussy from his inmates.